ECONOMIC OPENNESS AND GDP growth volatility

Mauritius - 16 September 2017

This paper tests the hypothesis that GDP growth volatility depends on trade openness, on economic governance and on the stage of development of a given economy. The results show that trade openness has a positive effect on growth volatility whereas economic and political governance have negative effect on volatility. This implies that volatility can be the result of not only high exposure to external economic conditions but also of internal governance factors.

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